N. SARASWATHI, W/O. LATE M. SHIVARAMU, AGE 62 YEARS, OCC: HOUSE-HOLD WORK, NO. 45, 22ND MAIN, 22ND CROSS, BANASHANKARI II STAGE, BANGALORE-70 Vs. KARNATAKA STATE FINANCIAL CORPORATION, HAVING ITS BANGALORE RURAL BRANCH OFFICE AT THE CHURCH STREE

JUDGEMENT

(1.) With the consent of the Learned Counsel on both sides, the appeal is taken up for final hearing.

(2.) Respondent No. 1 Karnataka State Financial Corporation (for short, the Corporation'), filed a petition under Section 31(1)(aa) of the State Financial Corporations Act, 1951, against Respondents 2 and 3 and the Appellant, to issue a certificate of recovery to realise Rs. 4,83,753.61 with interest and costs, inter alia contending that, M/s. Technocrat Reelers, a partnership firm represented by its partners, availed loan of Rs. 1,95,000/- by executing the loan documents, agreeing to repay the loan amount with interest. Appellant who was Respondent No. 3 in the petition along with Respondent No. 2 herein, executed a deed of guarantee in favour of the Corporation. Mr. Nandish, a partner of M/s. Technocrat Reefers, was the son of the Appellant. The loan amount having not been repaid and there being default, the said petition was filed against Respondents 2 and 3 and the Appellant.

(3.) The Appellant filed a statement and admitted the availing of loan amount of Rs. 1,95,000/- by M/s. Technocrat Reelers - partnership firm and the execution of the loan documents as well as the execution of guarantee deed by the partnership firm and the 2nd Respondent - S.C. Minajagi. The Appellant denied the liability to pay the amount claimed by the Corporation on the ground that, her son Nandish in whose favour she stood as guarantor retired from the partnership firm after entering into an agreement dated 1.1.92 between himself and the other partner Mr. S.M. Nagaraj of M/s. Technocrat Reelers. It was further contended that, as per the agreement dated 1.1.92, between the Appellant's son Nandish and the other partner of the firm, S.M. Nagaraj has undertaken to clear all liabilities of the partnership firm and hence the petition is untenable.